Q: Tax implications of jointly owning a house with parents in Virginia.

A: Owning a home jointly with your parents in Virginia does create a few potential tax considerations, but many of them depend on how you all manage the property financially and how the ownership is reflected on tax documents. Since your name is on the mortgage and you’re responsible for the loan payments, you will likely be the one eligible to claim the mortgage interest deduction on your income taxes. If your parents contribute to property-related expenses without claiming ownership of the loan or interest, they may not be able to claim tax deductions themselves.

The funds your parents transferred to you for the down payment likely won’t be considered taxable income, as long as it can be shown they were making a gift to help with the home purchase. For IRS purposes, they may need to file a gift tax return if the amount given exceeds the annual gift tax exclusion limit (which is $17,000 per donor per recipient in 2024), but that’s on their end—not yours. As long as the money was not payment for services or earned income, you won’t need to report it on your own tax return.

Regarding property taxes, Virginia assesses tax based on the property value, and the names on the deed determine ownership but not necessarily who is responsible for taxes. However, if you or your parents qualify for exemptions (such as a senior or veteran’s exemption), you may want to check with your local tax office to see if you qualify for any reductions. It’s also wise to keep records of who pays what, especially if you ever decide to sell the home or need to prove ownership percentages in the future.